It was later revealed that the film would have been shot in Wellington, New Zealand, and was slated for a summer 2007 release.[2]

Halo: Landfall, a promotional series for Halo 3, was composed of test shorts filmed by Blomkamp during the Halo film's early production.[5]

When plans for the film eventually fell through, Jackson and Blomkamp instead started production on District 9. Many elements from the cancelled Halo film were re-used or adapted for District 9, including the basic Warthog and Flood infection form designs.

In February, 2005, Creative Artists Agency confirmed that Microsoft had completed a $1 million deal with Alex Garland, the British screenwriter of 28 Days Later, to write the Halo screenplay, which would then be offered to studios.[6][5]

On June 7, 2005, Microsoft released Garland's completed screenplay to various Hollywood studios on, looking to be paid a $10 million fee as well as the studio's agreement to adhere to guidelines set by the game's developers.[7] Microsoft also wanted the studio to seek approval over the director and cast. In addition, Microsoft sought full merchandising rights for itself, a minimum $75 million budget, and company representatives' full access to the film's rough cuts in Los Angeles. Most potential studios - namely Paramount, DreamWorks, Sony, and Warner Bros. - did not want to cede creative rights to the film and passed over the project.[8]

20th Century Fox and Universal Studios entered negotiations with Microsoft to divide the distribution rights to Halo. The original $10 million deal was reduced based on the studios' negative response to the exorbitant price tag. All negotiating parties eventually agreed upon a deal to produce the Halo film; it was decided that Universal would distribute domestically, and take sales from the U.S. box office, while Fox would take the international distribution - with both co-financing the film. The studios agreed to give Microsoft $5 million to option the film, and 10% percent of grosses.[4]

On August 22, 2005, the deal was announced to be finalized, with summer 2007 as the target release date.[9]

On October 4, 2005, Bungie announced that Jackson was signed onto the project as executive producer.[10]

In July, 2006, author D. B. Weiss announced that he was working on his second draft of the new script for Halo, which contained elements of the project's original screenplay by Alex Garland.[11] Other screenwriters, namely Scott Frank and Josh Olson were also attached to the rewriting of Garland's script.

In August 2006, Jackson and the studios announced that Blomkamp would direct the project, for a smaller fee.[5] Microsoft originally wanted Jackson to direct, however Jackson's fee was already running into several millions of dollars.

Blomkamp stated he was confident that Bungie liked the initial concept art for the project, however Microsoft were afraid the material might be too unconventional for a summer blockbuster. Universal had already funded $12 million for preliminary development; a portion of this spent by Guillermo del Toro (attached to the process before Blomkamp), with the rest having been spent hiring the various writers to redraft Garland's screenplay.

In October 2006, Universal proposed a reduction in the producers' fees. Jackson consulted with Microsoft, his co-producers, and Blomkamp, but ultimately refused the deal. Universal and Fox subsequently removed themselves from the deal. Blomkamp and Jackson have both cited money and control as their main reasons to abandon production.[12]

After the departure of Universal Studios and 20th Century Fox, a representative of Jackson and Walsh stated;

“

Universal, on behalf of both studios, asked for a meeting with the filmmakers just prior to the due date of a significant payment. Basically, they said that in order to move forward with the film, the filmmakers had to significantly reduce [the percentage of profits they would receive from the film]. They waited until the last minute to have this conversation. Peter and Fran, after speaking with their producing partners and with Microsoft and Bungie, respectfully declined.[13]

”

Contrary to claims that Microsoft were seeking other distributors for the film, WingNut Films stated;

“

As was previously confirmed, we deeply regret that both Universal and Fox did not choose to move forward with financing the Halo film under the original terms of the agreement. At this time Peter Jackson and Fran Walsh, along with their partner, Microsoft, have mutually agreed to postpone making a feature film based on the Halo video game universe until we can fulfill the promise we made to millions of Halo fans throughout the world that we would settle for no less than bringing a first class film to the big screen. We are fully supportive of director Neill Blomkamp's vision of the film. Neill is a tremendously gifted filmmaker and his preliminary work on Halo is truly awe-inspiring. While it will undoubtedly take a little longer for Halo to reach the big screen, we are confident that the final feature film will be well worth the wait.[3]

On October 29, 2007, Ken Kamins, a representative of Jackson, confirmed in an interview that the Halo film was still in pre-production. According to Kamins, Blomkamp had not been dropped - in spite of his earlier statements.[14]

On July 24, 2009, Blomkamp denied that his upcoming District 9 would be a showcase for his Halo film intentions, and confirmed he is no longer involved[17]

In August, 2009, Blomkamp revealed that the film's budget would have been $120 million.[18]

On August 10, 2009, Steven Spielberg was reported to have been "blown away" by Beattie's screenplay, and was in "active negotiations" to produce a future Halo feature.[19]

On August 11, 2009, Microsoft responded to the above report, claiming it was "glad" of the enthusiasm surrounding a Halo feature, although the project still remains on hold.[20]

On October 6, 2009, Frank O' Connor confirms that Microsoft is still "being very careful to pick the right time and the right partner" with regards to a new Halo feature.[21]

In 2010, O' Connor states that Microsoft will make a film "when the time is right", and that it would be a standalone story rather than a "a verbatim retelling of the game".[22][23] O' Connor also hinted at a future live action miniseries, which would later be revealed as Halo 4: Forward Unto Dawn.